"This study shows that increasing associated gas utilization in Russia can translate into substantial economic and environmental benefits," says Klaus Rohland, World Bank’s Country Director for Russia. "That the Russian Government has started to address the flaring issue is a significant step toward improving Russia’s overall energy efficiency."
The GGFR partnership estimates that globally at least 150 billion cubic meters (bcm) of gas are flared every year, adding about 400 million tons of greenhouse gases in annual emissions. This is equivalent to almost all the potential yearly emission reductions from projects currently submitted under the Kyoto mechanisms. Most of the flaring occurs in some 20 countries around the world.
The new study estimates that Russian oil producers annually flare some 38 billion cubic meters (bcm) or 1.3 trillion cubic feet (tcf), or some 45 per cent of the country’s associated gas production. In addition, it is estimated that some 10 bcm is flared from gas condensate production.
The study estimates that it could be economically viable to utilize up to 80 per cent of the flared gas in Russia, generating several billion US dollars in annual value and eliminating up to 80 million tons of carbon dioxide emissions per year.
"Utilization requirements and flaring penalties alone will not significantly reduce flaring as long as the barriers inhibiting commercialization of the associated gas remain in place," says Anastasiya Rozhkova of the GGFR partnership . "Gradually raising domestic gas prices to stimulate investment and ensuring transparent access to the transportation network are also important steps in the right direction."
What the study shows
PFC Energy analyzed and compared the economics of five options for increasing associated gas utilization in Russia, including:
- Generation of electricity to provide power to the oil field
- Generation of electricity for the regional market
- Process into LPG (propane, butane), petrochemicals and dry gas
- Process into diesel or methanol (Gas To Liquids)
- Re-injection for Enhanced Oil Recovery
Further, the PFC analysis shows that:
- The optimal use of associated gas varies with the size of the producing field.
- For small fields, the most attractive option is through small-scale power production to meet the needs of the field itself (electric submersible pumps, etc.) and other local users.
- For medium-sized fields, the most economic utilization option is through extraction of the LPG in gas processing plants, and sale of the LPG or petrochemicals and dry gas.
- For large fields, the most attractive option is electric power generation through a large power plant selling power wholesale to the grid.
Gas Flaring Worldwide
The major flaring region in the world is Russia and the Caspian (about 60 bcm), followed by the Middle East and North Africa region (about 45 bcm). Sub-Saharan Africa (about 35 bcm) is the third flaring region, followed by Latin America with some 12 bcm of gas flared annually.
Some of the major flaring countries in the world include: Russia, Nigeria, Iran, Iraq, Angola, Venezuela, Qatar, Algeria, the United States, Kuwait, China, Indonesia, Kazakhstan, Equatorial Guinea, Libya, Brazil and Mexico.
